Which of the Following Theories Has the Least Practical Application

question 157

Multiple Choice

Which of the following theories has the least practical application regarding the way companies actually set dividend policy?

• A)The clientele effect
• B)The residual dividend theory
• C)The signaling effect of dividends
• D)The expectations theory
• E)None of the above has practical application with regard to dividend policy.

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Definitions:

Transformational Change

A profound or radical shift that fundamentally alters the nature or direction of an entity.

Modest Change

A minor adjustment or slight modification to a process, system, or product.

Gradual Change

Incremental alterations, modifications, or developments occurring slowly over a period of time.

Evolutions

The gradual development and progression of species or systems over time, often associated with biological, technological, or organizational changes.